on Corporate Social Responisibility, sustainability, responsible business practices

Sustainability Asia MACHI

Sustainability in Asia: connecting to everything else

Recently I was invited to give a talk on the topic of ‘climate change and sustainability in Asia’. While accepting this invitation easily, my immediate response was also “Let me think about how to put this together coherently.”

Having one and a half hours to fill on this topic in front of an audience of experienced diplomats was a pretty daunting task. I am in front of various audiences regularly, but always with a more focused and concise topic such as CSR in Japan or sustainability as a business opportunity in China.

But talking about climate change, sustainability and Asia – isn’t that like talking about, well, everything? Where do I start?

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business to Myanmar Guillén Pérez

Bringing your business to Myanmar?

Setting up business operations or otherwise taking your business to Myanmar? Consider how you can contribute to a sustainable and inclusive economy.

It is likely a coincidence, but it is fitting that in the month that Myanmar’s first democratically elected President Htin Kyaw took office, developments in Myanmar were also in the spotlight in the Netherlands with several well-attended events in April on doing business in Myanmar.

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Why working on human rights in China is good for business

Today, October 25, the state visit to China of the Dutch King and Queen officially started. In the run-up to this state visit, the discussion on whether or not the King and Queen should talk about human rights in China in their meetings with Chinese counterparts intensified again. This is a regular recurrence ahead of any high-level event between the Netherlands and China. It is also not unique to the Netherlands. I have read similar discussions in the past week while President Xi visited the United Kingdom.

As usual, the state visit is accompanied by a large trade delegation. And sometimes the question about human rights in China also gets asked of Dutch entrepreneurs: Do you talk about human rights when doing business in China?

The answer often is: We’ll leave that to the politicians.

At first glance, this makes sense. For example, when talking about the Chinese government’s attitude to human rights’ defenders, which is often part of this discussion. How can a Dutch business do anything about this? Let business people focus on running their business.

More than freedom of expression

What is forgotten here is that human rights are many more than only the rights referred to in the above context, such as freedom of expression. The Universal Declaration of Human Rights also includes others such as freedom from slavery, the right to a fair wage and the right to join a trade union, to name a few. These are the type of rights that should have the attention of business. After all, business has an impact on what people earn, under what conditions people work and on the environment (clean or polluted) people live in.

This gives businesses a responsibility to respect these rights and to ensure that their business operations do not have a negative impact on them (on the rights of employees, but also on the rights of people living near a factory, for example). The United Nations Guiding Principles on Business and Human Rights are the framework that outlines this responsibility. The Guiding Principles are also integrated in international standards such as the OECD Guidelines. These Guidelines are the foundation of policies on international corporate social responsibility as developed by the Dutch government: Dutch companies are expected to follow these Guidelines in their international operations.

In some countries the discussion on business and human rights has already led to legislation: this year, anti-slavery legislation came into effect in the UK and as of this month, as part of this law, large corporations are required to report on the steps they have taken to ensure slavery does not exist in their supply chain.

An opportunity for business

Over the last decades, China has achieved remarkable progress on eradicating poverty. This is a commendable achievement but unfortunately not all problems are yet solved. Regularly, multinationals headline international media with news on unsafe labour conditions or on toxic materials used on their production locations in China. International supply chains are often long, complex and non-transparent: it is difficult to know everything that occurs in the many links that connect that supply chain. But by not knowing, a company exposes itself to a lot of risk.

It is not all bad news. In addition to the ethical argument that a modern business should take responsibility for the societal impact of its business operations (aside from only financial impact), companies increasingly show that it can be good for a company to do so.

In-depth knowledge of what happens in your supply chain and executing due diligence, ensures that a company can act faster on issues that might otherwise only show after causing a problem. This means that a company can manage its supply chain risks better and can prevent unnecessary disruptions to production.

Transparency about a company’s policy on human rights and CSR increases access to finance, from banks or investors but also when applying for funding from the Dutch government (which requires following the abovementioned OECD Guidelines). That transparency also leads to increased trust from clients: when supplying business clients it means that you are also reducing risk for them. But also consumers are increasingly asking questions about where and how products are being manufactured. Being able to provide answers to those questions can give you access to a loyal new group of customers.

How does your business work on human rights in China?

Taking the above perspective, it almost seems strange that companies who do business in China (or any other country) don’t get that question more often. Within their value chain, this is something a company has influence on: human rights are not only relevant to politicians but also to business. Positively using that influence, sets a company apart from its competition and makes it better positioned for future business success.

Does this sound complicated? That first step is easier to take than you might think: take a good look at your business operations and your (international) supply chain and use that as your starting point. Knowing your supply chain and identifying the main risks is key. Go from there for your next step.

Are you wondering if you should even be active on the Chinese market because of the government’s human rights track record? Then also consider that even if you cannot influence government policy, you can make a positive impact through your own activities and your supply chain.

This blog was first published in Dutch on www.china2025.nl

Exploring fair fashion (3): Fair Fashion Lab

A honest and humane future in the fashion industry.

This is what Fair Fashion Lab, the current temporary exhibition at the Humanity House in Den Haag, is exploring through six installations by Dutch artists.

The exhibition has been set up in response to many factory disasters in the textile and fashion industry which have happened over the last few years, of which the Rana Plaza collapse in April 2013 has been the largest recent disaster. The fashion industry is being confronted with more pressure – from some consumers and from government, at least in the Netherlands – since then to be more transparent about how and where it manufactures its products and what it is doing to clean up their supply chains.

It took me a while to actually make it to this exhibition, but I’m happy that I finally walked in a few weeks ago – considering my interest in this topic, and my own exploration to find responsibly produced clothes (here & here).

Rather than diving into a theoretical analysis of all the things that are wrong in the supply chains getting fashion into the shops, the Fair Fashion Lab invited six artists to give their perspective on solutions for the industry. This has resulted in six very diverse installations.

What all the installations have in common is that they challenge the visitor to think about what they wear, where they buy their clothing and what they might do differently next time they walk into a clothing shop.

For example, one artist shares different ways of DIY-fashion, and another commits visitors to always ask in a shop where the piece of clothing they want to buy is made.

These are easy things that people can do, even if it can sometimes be frustrating. My own questions to shop assistants about information on local production only rarely gets a satisfying answer. Yet, the exhibition also offers a great opportunity to give visitors more: even if it is just some additional information on fair fashion – such as referrals to apps and sites which lists brands that are open about their production process (such as the EerlijkWinkelen shopping routes, the TalkingDress app and more)

Luckily, part of that is covered in the events and side-programme that accompany the exhibition. Such as the Fair Fashion Lab Festival coming up on October 18 & 19: workshops, presentations, a fashion show and a pop-up shop for all your fair fashion questions.

The exhibition Fair Fashion Lab can be seen until 31 December 2014.

Tackling climate change: mainstream or frontrunner?

Yesterday afternoon I read an article on the website of the Telegraaf, the largest daily newspaper of the Netherlands, in which the paper shared the results of an online poll that had been running the day before. The statement being polled was: “Climate change is complete nonsense”.

The result: 61% agrees it is.

The more I read in the article about the rest of the results the more depressing it was. 80% doesn’t worry at all about the consequences of climate change and people believe environmental organisations are only in it for the money.

….

Half an hour later I was on my way to something I knew would make me feel a lot more positive again about what’s happening in the world: with a group of people at Den Haag in Transitie (DHiT), a local transition network, we were going to spend an evening talking about how the many local initiatives happening at DHiT link to major global issues such as climate change, environment, energy, etc. It was a really fun night where people were talking about solutions and opportunities to make changes and how to make those possible.

I came home energized, inspired and with lots of new ideas.

So what is more important or the most effective way forward?

Finding ways to get everyone on board or supporting those small groups of people way ahead of the mainstream in making things happen?

Exploring fair fashion (2): finding answers

Two months ago I wrote about my frustration that no one in clothing shops ever seems to have an answer to my question: “Where and how is this dress/skirt/shirt made?”

Today, though the shop assistant couldn’t answer my question about the particular shirt I was holding, she could at least give me alternatives in her shop. And she said that their customers do ask about how things are made that they sell – which I haven’t heard anywhere else before.

Part of her answer was that they only stock smaller brands. I think she meant that that implies that these brands also take better care of their supply chain. I don’t think that’s necessarily true. It’s possible that a smaller company has a less complex supply chain and therefore knows better where and how its products are made. But it’s also possible that a small company doesn’t have the resources to go into these issues and outsources their production to unknown third parties.

Anyway.

It doesn’t change the fact that it’s difficult to get answers to this question, when you care about the production circumstances of the things you wear and use.

Asking for transparency

Following up from my post in October, I now know a little bit more about Nümph‘s policies on responsible production. I understand that it’s difficult for a company to be open and transparent about these topics – especially when it’s ‘just’ a random customer asking. From the information I’ve received the company follows regulations on e.g. REACH and child labour. Several of their producers in China are BSCI-certified.

These are good things.

Yet I was hoping for more. But maybe this is too difficult to share or to explain? Then again, if a clear policy would be in place – such as minimum requirements for suppliers – it would help so much if this is more openly shared. I have no hesitation buying things from Skunkfunk because of their extensive information online. It may not be possible to guarantee that nothing will go wrong, but showing that a company cares goes a long way in my book.

Another example of showing you care is what I came across today in Vanilia’s shop (I thought about taking a picture – and didn’t. I’ll have to go back). Along with the price tag is a small tag that says: we care.

With the questions I ask, what I have in mind mostly is local labour conditions. And yet. There’s so much more that is happening in the supply chain in the fashion industry. Greenpeace had a big campaign earlier this year on the use of toxic chemicals in the textile industry.

Adding more issues to think about

And only today a friend alerted me to the possibility of GMOs used in cotton in China….

It’s way too much to be able to take in when you are out shopping.

And as someone told me a while ago: there really are no realistic alternatives to the regular high street brands out there. With emphasis on realistic: where you don’t have to trawl online for information, email brands, and so on….

In the Netherlands, the discussion for a cleaner supply chain in the fashion industry has been on-going. And only last Friday, the minister of Foreign Trade and Development Cooperation published the Dutch National Action Plan on Business and Human Rights. The action plan calls on businesses to put more effort in to knowing the impact their corporate activities have on human rights – be it within their own operations or in their supply chain – and to show what they do about preventing or mitigating the effect of these activities on human rights abuses. I look forward to see how these intentions will be put into further action, and if this will trickle down to, for instance, consumers like myself (or rather, consumers not like myself).

PS, my shopping excursion this afternoon did lead me to a new discovery for beautiful accessories: CultureMix

Fair fashion: a personal exploration

Hopefully some of you can relate to this situation. When you find the perfect dress (or jacket, skirt, etc), but then before paying at the counter you think you should also really ask the staff if they can tell you anything about the brand’s CSR policy or about local production circumstances. I.e. does the brand you are intending to buy from operate responsibly? Of course, the staff doesn’t know. I’ve never actually had an answer that made sense when asking this question.

So what do you do? Put back the gorgeous dress because you don’t know how the brand does business, or do you buy it anyway (thereby negating any impact your question might have made: clearly you don’t care at all)?

Yes, sometimes these are the questions that I go shopping with. (And yes, I’m good at making my life difficult)

Of course, when talking about international CSR policies of companies in the Netherlands, you quickly hit the textile industry where this has been a major issue this past year, spurred on by the incidents in Bangladesh. The collective industry has come out with an action plan with the objective to drastically improve the supply chain of Dutch companies in this sector.

Increasing transparency

But another thing that is related to this is being transparent about what a company does, and what its supply chain looks like: what do brands show and say about their business operations? I believe that increased transparency will help a lot in encouraging responsible business practices. If a consumer can tell where the clothing he or she is planning to buy has been produced and how, this can (hopefully) influence someone to buy the better product (though, of course, there will be many a dilemma like the one mentioned above). I’ll soon share a project I’m working on with CHFC that aims to contribute to increasing that transparency.

Where to find information?

But in the meantime: I want to know where the things I wear are made, and how. There are different websites where you can find fair fashion brands (such as here or here) which helps of course. But what about the brands I already wear? And sadly, I can’t really find reliable information on those on, for example, GoedeWaar or Rankabrand.

So I’m intending to take you on a bit of a personal exploration – and you’ll get to know my wardrobe as we go too 😉

I’m starting with two of my favourite brands: Skunkfunk & Nümph. And they couldn’t be further apart on this topic: Skunkfunk has an extensive page on sustainability, while Nümph has nothing. I’ve sent them an email to ask…

To be continued.

Bangladesh and the long road to ‘fair’ fashion

When it comes to news on CSR in Asia, this week has been all about the collapsed factory in Bangladesh. As I’m writing this, the news is announcing a still rising death toll, up to 500+ by now.

A tragedy. And I feel it does show that the prices we pay for our clothes in Western Europe are not sustainable, least of all for the people who manufacture these clothes. Would it kill us to pay a few euro more for a t-shirt so that other people can have a slightly better standard of living?

The problems in Bangladesh’ textile production industry aren’t new, and a search on the BBC News site will bring up reports from many accidents over the last few years. A change is long overdue.

Today I also heard the news that Disney is withdrawing its production from Bangladesh (and several other countries).* Apparently this had already been decided after the fire in a textile factory in Dhaka killing over a 100 people in November 2012.

However, even if this may be an effective way for Disney to reduce its risks, this can’t be the way that that change is going to take place. Without the textile industry in Bangladesh, many many more people would be without a job and without any income. Bangladesh depends in large on this industry for its exports. Should we boycott the country? Or should industry take responsibility and work together with (local) government and ngo’s to improve the labour circumstances on the ground, and thereby improve the quality of life of many people?

An easy choice, when writing it down like that. But a difficult process to begin and to get going effectively. And, it can’t be down to industry alone. It also means that consumers have a responsibility to ask for better produced clothing. Unfortunately, that requires information: how does your favourite brand rank when it comes to labour, safety, health in its production locations?

In the Netherlands there are a few resources available, which will hopefully be gaining in exposure. Some examples are Rankabrand and an app by Talking Dress to help you find brands that perform better on these issues.

And if you want to know more about sustainable fashion or CSR in the textile industry, there are a few events coming up in the next two months or so:
> the communications agency Schuttelaar & Partners will host their next Maatschappelijk Café on fair fashion (May 28, Den Haag)
> three Dutch industry associations in textiles and fashion are collaborating to organize a conference on CSR in the textiles industry: Groen is de Rode Draad (June 20, Den Haag)

* UPDATE [5/5] – through a friend I just came across this article which discusses the Disney withdrawal in more detail. I still don’t believe that disengagement is the way forward. However, I can also understand the argument of lack of leverage (assuming Disney’s leverage is as non-existent as they seem to imply) for disengaging if that means you can allow more attention and effort in making sure other production locations are responsibly managed. Nevertheless, I do hope the choice for which country to leave from and in which country to stay was not just based on a Worldbank list as it should also depend on individual factories and local knowledge (available within the company, Disney in this case) – where circumstances may vary a lot locally.